The Palestinian negotiator in Mideast peace talks called Israel’s decision to stop tax money transfers “piracy.”

Saeb Erekat said Friday that “the Israeli decision to withhold these funds is piracy. … It cannot be maintained.” He also said talks persist, though “gaps remain big.”

Erekat spoke a day after an Israeli official said Israel would stop the tax money transfers in retaliation for the Palestinians pushing to sign up for more recognition from international agencies and treaties. That comes after Israel failed to release Palestinian prisoners as promised and moved forward with more settlements in land Palestinians want for their future capital.

Israel collects about $100 million a month in taxes for the Palestinians. It isn’t clear how much would be withheld or for long it would go on.

Meanwhile, Israel demolished several European Union-funded humanitarian housing shelters in a highly sensitive area of the West Bank outside Jerusalem, an EU official said Friday.

“On April 9, three of some 18 residential structures were demolished… in Jabal al-Baba,” an area outside the sprawling settlement of Maale Adumim, a spokesman for the EU’s delegation to the Palestinian territories told AFP.

The tin huts, used to house Palestinians made homeless by severe winter weather at the beginning of the year, were “partially funded by EU member states,” the official said.

Israel issued demolition orders on all 18 structures in February, the official said, and EU delegates “raised this with the Israeli authorities” both at that time of and after the demolitions.

The EU official said simply that there were ongoing discussions with Israeli authorities over the demolitions, but a report by EurActiv, a Brussels-based news service, said diplomats were demanding financial compensation.

“We should ask for compensation from Israel whenever EU-funded humanitarian aid projects are destroyed,” EurActiv quoted an anonymous diplomat as saying.

Israel’s military administration of the Palestinian territories could not immediately comment on the demolitions.

The structures were located in E1, a highly contentious area in the West Bank east of Jerusalem.

Israel has been planning construction in E1 since the early 1990s but nothing has ever been built there due to heavy international pressure. Plans for building 1,200 units unveiled in December 2012 were quickly put on the back burner after the announcement triggered a major diplomatic backlash.

The Palestinians say construction in E1 would effectively cut the West Bank in two and prevent the creation of a contiguous Palestinian state.